Committee member and board president london breed to my left. Our clerk is ms. Erica major. Ms. Major do you have any announcements. Yes. Please silence all cell phones and electronic devices. All documents submitted to the clerk and items will be on the clerk and items will be on the october 18 board of supervisors agenda unless otherwise stated. Thank you. Could you please read the first item. Item 1 is a hearing to receive presentations from the citys external auditor Macias Gini Oconnell and kpmg llp. Thank you. Do we have a representative from the Controllers Office. Ms. Frank. Yes, good morning supervisors i am here to introduce the external auditors. First you will hear from m go and kpmg senior manager. Great and what is the status of the consolidated annual Financial Report . Hows that coming along . Eer. Starting the final phase right now and putting in adjustments so we dont have the Financial Statements together yet but anticipated it will be completed in november around thanksgiving. Okay. And then we will come back in the spring over the single audit is completed and the financial audit and present to you any findings for all the departments. Sounds good. Please proceed. Good morning i am annie lee from m go and lisa from kpmg. Were going to do our presentation together because theyre similar. I believe you have the documents in front of you and the Audit Service plan as well as kpmgs and the first item i will go over is the planned scope of services. Our firm m go does the cafr annual Financial Report audit, the citys oddity the retirement success, the Successor Energy the port of San Francisco and the finance corporation and the oddis for the automobile and workmans comp program and the Transportation Fund and the transportation act and agreed upon procedures for the appropriations limit. And for kpmg the scope of our audit we audit four stand alone departments, one being the San Francisco health system, the other being the Municipal Transportation Agency. These are page 11 of your slides. For the mta we issue a Financial Statement audit, a single audit and three agreed reports that were engaged to separately opine on and the Public Utilities commission and we issue a report in the january time frame on the statement of changes in the balancing account of the water enterprise and then we audit the San FranciscoInternational Airport and we conduct both a Financial Statement audit and a single audit. So next were go over the objectives. You can find the information on page 12 and 13 of our plan and page five of kpmgs plan. Basically the objective is [inaudible] on the Financial Statements and sproid absolute assurance. In terms of management responsibilities its on pages 13 through 15 of the m go audit plan as well as page seven of kpmgs presentation. To summarize the Information Management is responsible for the Financial Statements and compliance with the applicable requirement as well as having effective internal controls over Financial Reporting as well as for compliance. The next item is the timeline and that is found on page five of mgos plan and page 13 of kpmgs plan. As carmen mentioned earlier the main item strt citys audit and the cafr and should be completed around november thanksgiving and the single audits should be completed and we will bring back the results. The last item i would like to go through in the last section of the audit plan on pages 19 through 21. Theyre announcements issued by the government Accounting Finance board so were announcements that have to be implemented by the city in the next three to four years. The two i would like to highlight are gasb 73 and 74 that relate to the opeb standards so there are changes in how the opeb benefits will be contacted for by the opeb plan as well as the employer and how the information will be presented in the Financial Statement. These are the gasb 74 and 75 74 Financial Reporting [inaudible] benefits. And what about gasb 82 . Gasb 82 is not effective yet. It is a amendment to the pension issue which was implemented by the city excuse me in fiscal year 2015, so because of implementation that was done by Government Entities country wide there were issues brought up to the gasb, to the board about the financial standards so they have issued some amendments to clarify the original pension pronouncements. Right and i do want to point out that mta did elect to early adopt gasb 82 and there was a nuisance in the standard that was applicable to them so the implementation of that will be reported in the 2016 audit that we issue this month. Thats correct. And it didnt have any impact on the rest of the city. And i just to announce we have been joined by vice chair supervisor norman yee. With that we will take any questions that you may have. Colleagues any questions on the audit plan report by mgo and kpmg . Seeing none we will see you after you figure out where our material weaknesses are. Thank you. Thank you. Are there any members of public to testify on item 1 . Seeing none. Public comment is now closed. And we will can we have a motion to file this item . Moved by supervisor breed without objection the item is filed. Madam clerk can you read the next item. Yes, item 2 is establishing a new Public Benefit civic nonprofit entitled to yerba buena gardens conservancy to assume longterm operating and management responsibility for yerba buena gardens. This item has been brought to us by supervisor kim who i think is joining us so why if there is no objection colleagues read item number 3 and when supervisor kim joins us thank you all for your patience. We will hear from her on item number 2. Madam clerk can you please read item number 3. Yes. Item 3 is receive updates from various city departments who were required to provide a response on the implementation recommendations in nos r. A. 2 and r. B. 1 contained in the 201516 civil grand jury report entitled San Franciscos crime lab promoting confidence and building credibility. Great. We heard this item once before and there was ongoing discussion about the possibility of transferring the crime lab to the City Administrators Office and we wanted to hear more about that and i believe the city administrator and others thought there would be a report or answer by october 6 which is today. Why dont we start is there anybody here from the civil grand jury who would like to say anything or present . If not is there anybody here from i see please come on up. Good morning. My name is charles thompson. Mr. Thompson we remember you well. Yes, thank you, thank you. I just believe its also important to find out a lot of the implementation of the recommendations, particularly the issue of the independence of the crime lab, the movement out of the Police Department, and the issue of reinstating the drug analysis lab. Both of those depend upon the hiring of the civilian scientist and according to the comments that we received back from the city that was to be completed by january of 2017 which is just under three months from now. I think it would be important to find out the status of that as of today as to where the city is in hiring that civilian scientist and what the current estimated hiring date is likely to be. It seemed to me at least a month ago that the time was rather an aggressive time to hire someone like that, and since so much depends upon that person i would like to better get a understanding of where the city stands, and that would be perhaps through the deputy chief who is here today. Yes, we will hear from deputy chief shmidt as to the status of that position as well to the other issues that you raised. Deputy chief schmidt. Good morning. Good morning chief. Thank you. Okay. The status of the Forensic Services director we will start with that, so we identified the position with hr. They put out a rfp to get a Recruitment Firm. We selected the Recruitment Firm of bob muiro and associates and had the kick off meeting and three weeks into the 16 week process for the recruitment and selection of the Forensic Services director. So 16 weeks. That puts you on course to hit january of 17. Yes to select. And we havent had any you know, were excited about the progress that the search firm is making. We expect to be reviewing the job announcement. Weve already identified with them where we will be pushing that out throughout the industry, so the specifics of that we should be reviewing by next week and they should be good to go on the timeline. Good. And as to recommendation ra2 which was going to require further analysis . Yes, so thats going to require further analysis in working with the City Administrators Office, the Controllers Office and the Mayors Office and staff from the city mifert city administrator and i met for a plan and timeline for the analysis. There is a number of operational issues to look at within the Police Department. How we touch on evidence, transport evidence, brins it into the system, how its analyzed and pushed back out to the different stakeholders outside the system so all of our internal processes should be analyzed in this. Theres of course the personnel issues. Theres just many complex areas that this touches upon so weve committed to forming working groups on each end and started on our end. The analysis of those systems so that we can begin meeting and scoping out just what that would look like for the city. So would it be fair to characterize that as this is unlikely this functional transfer to happen anytime soon. Is that a Fair Assessment . Yes. I think that we need we really need to understand the full scope of what we would be under taking as a city, and so i think the smart thing is put the work in now, and then you know move forward with the presented analysis that can be considered in and determination made. Colleagues any questions for Deputy Schmidt and anything you want to cover . For the record he defers to the deputy chief. Well, theres a first. [laughter] are there any members of the public who would like to testify on this item numberly, Public Comment . Seeing none. Public comment is now closed. Thank you for the update chief. Any questions for members ever the panel . Seeing none. Public comment is now closed and can we have a motion to file this item . Before we file the item theres two items in here, right, that we need to respond to . Thats correct. So we would like to read that into the record. Madam clerk could you read the first one that we need to respond to [inaudible] sure. Just one second. Its i believe ra2 is the first one. At the bottom of page two. The rpz ra2 the mayor should direct the board of supervisors should approve and the controller facilitate the budget and assets and personnel and management from the crime lab sfpd the Police Department to gga General Services department to Administrative Services. And the recommendation for the response is that the recommendation will not be implemented. The board of supervisors and the reason for this is that the board of supervisors reports recommendation number ra2 will not be implemented for reasons as follows. The board of supervisors government audit and Oversight Committee agrees that the San FranciscoPolice Department and the General Services agency need further time to meet thoroughly formally and evaluate a proposal of how the transfer of the budget, facilities assets, personnel and management from the San FranciscoPolice Department to the General Services agency. However, until the two departments complete and submit their proposal to the board of supervisors for further evaluation we cannot approve this transfer. Okay. So that one recommendation and the other and that would be for ra2 at the bottom of page two. And the other item is rb1. Rb1 states that the crime lab and the Police Departments office of technology should devote all necessary resources to install and implement [inaudible] Laboratory Management system that will track cases increased Laboratory Efficiency facilitate outcomes and real time sharing of information. So this recommendation has been implemented. The laboratory Information Management system has been purchased and is in the process of being customized with few implementation expected in spring of 2017. The lims system will be fully operational in the spring of thats repeat. The Mayors Office is still in the process of hiring a new Forensic Services director. As was said so that would be the changes to rb1 on page three which last time we said has not been fully implemented but we will change to has been implemented. Correcty. Correct we am take that as a motion from supervisor yee and supervisor breed take that without objection. [gavel] and on the item as amended. [inaudible] into a motion and forwarded as the recommendation. I will move that. All right. Moved with supervisor yee without objection that is the order. All right. Do we have somebody here for item number 2 . Thank you chief schmidt and thank you mr. Burr cow ski. Well why dont we start with the budget and legislative analyst. Would you like to give a briefing on item number 2. Certainly mr. Chairman, members of the committee. Baby branew debra newman from the budget and analyst office. This would acknowledge the establishment of a new benefit civic nonprofit called the yerba buena gardens conservancy and the creation of this nonprofit would be specifically to assume the longterm operating and management responsibility for yerba buena gardens under a master Lease Agreement that would have to come before this body for approval. As you probably know yerba buena gardens was created originally as a redevelopment project area and the office of Community Investment and infrastructure oc ii currently owns and maintains and manages yerba buena gardens as the agency that is taking over since redevelopment has been stopped under state law. It is anticipated that yerba buena gardens will transfer from ocii to the city some time in 2017. The office of Administrative Services has agreed to this transfer. This transfer will be done at a cost of zero because of the use of the property for Public Services or public operations. Currently yerba buena gardens is shown in page nine of our report. Theres an attachment that shows it is being fully supported with the revenues that are coming from primarily longterm leases that were under entered into by the redevelopment agencies and the properties surrounding yerba buena gardens. As shown in the attachment that was provided by ocii this again is on page nine of the report. The actual revenues in fiscal year 1415 totaled about 13. 3 million and expenses totaled about 8. 4 million resulting in a surplus of over 5 million. However, the projections show that over the next ten years revenues are projected to decrease ranging from 9. 6 million to 11. 6 million with expenses increasing to between 10. 6 and 12. Eight. The reason for the change is primarily due to increases in expenses coupled with significant Capital Improvement costs that are assumed to occur in those latter years. Given that this legislation is would then as i indicated in 2017 ocii intends to transfer the property of yerba buena gardens to the city that is not the subject of this legislation. In addition, if the intent is to enter into a longterm master Lease Agreement with yerba buena gardens conservancy that is also not the subject of what is before you. This resolution would do is simply state the intent is to enter into this agreement and set the policy for the creation of this nonprofit. I note the nonprofit has already been created. If this is done the future master Lease Agreement would need to be done on a sole source basis and we therefore say that this recommendation this resolution is a policy decision for the board of supervisors. If the board wishes to approve this resolution we also make two recommendations to you. One to provide guidance to both the newly formed nonprofit as well as the Real Estate Division who is working with them right now regarding who would make the appointments